August 12, 2013 Read More →

India Inc tangled in Australia red tape

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MUMBAI- “India Inc, which cited policy paralysis at home among several reasons to invest in Australia’s mining sector, is finding it even more difficult to acquire land, get environmental clearances, overcome regulatory hurdles and achieve financial closures for projects worth billions of dollars down under.

Adani, GVK & Lanco invested a total of $4 billion in the Australian mining sector in the last three years and committed to invest another $21 billion. Their projects are not moving ahead because of similar bottlenecks that these companies face closer home.

GVK faces environmental challenges. The project GVK group is working on is environmentally-sensitive and is over 50 times of it current market capitalization. GVK is seeking to raise a total of $10 billion to build Australia’s largest black coal mine in Queensland’s remote, untapped Galilee Basin.

A recent report last month by the US-based Institute for Energy Economics and Financial Analysis titled ‘Stranded: A financial analysis of GVK’s proposed Alpha Coal Project in Australia’s Galilee Basin’, labelled GVK as a ‘weak investment partner’ and the Alpha project as a ‘quagmire, not an investment’.”

By Piyush Pandey, The Times of India

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